Many stocks have been testing new highs in 2020, and one of the most notable is Signet Jewelers Limited (SIG). Currently, SIG is trading at $16.87 and the avg recommendation for the stock is Hold. while the current analyst price target stands at $7.75.
To add more color to this target, the company’s high over the last year is $31.44 and the low is $5.60. Over the last 52 weeks, SIG is down -46.34% while the S&P 500 is up 1.21%. The catalyst for this interesting swing was the company’s recent earnings report.
A Notable Earnings Report
In the last quarter, SIG reported a profit of $897.9 million. Signet Jewelers Limited also saw revenues increase to $2.15 billion. In addition, SIG has free cash flow of $419.4 million as of 01-2020 The company’s EBITDA came in at $7.4 million which compares well with its peers.
SIG booked profit margins of 1.20%, its Return on Equity (ROE) is 6.40%, and its Return on Assets is 1.20%. All told, it is clear that, SIG needs to be on your watchlist.
About Signet Jewelers Limited
If readers are unfamiliar, Signet Jewelers Limited engages in the retail sale of diamond jewelry, watches, and other products. As of February 01, 2020, it operated 3,208 stores and kiosks. The company operates through three segments: North America, International, and Other. The North America segment operates jewelry stores in malls and off-mall locations primarily under the Kay Jewelers, Kay Jewelers Outlet, Jared The Galleria Of Jewelry, Jared Vault, Zales Jewelers, Zales Outlet, Piercing Pagoda, Peoples Jewellers, Gordon’s Jewelers, and Mappins Jewellers regional banners; and JamesAllen.com, an online jewelry retailer Website. This segment operated 2,639 locations in the United States and 118 locations in Canada. The International segment operates stores in shopping malls and off-mall locations, principally under the H.Samuel and Ernest Jones brands. This segment operated 451 stores in the United Kingdom, the Republic of Ireland, and the Channel Islands. The Other segment is involved in the purchase and conversion of rough diamonds to polished stones, as well as provision of diamond polishing services. Signet Jewelers Limited was founded in 1950 and is based in Hamilton, Bermuda.
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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. SIG has a short ratio of 4.97 and outstanding shares of 51.70M.
SIG has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 4.04 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at 1.38. Signet Jewelers Limited SIG also noted assets of $6.3 billion at the end of the last quarter. Investors should also keep an eye on sector updates as SIG has historically followed its peers on positive news.
All told, Signet Jewelers Limited SIG has strung together solid data and demonstrated underlying fundamentals. At its current valuation, SIG represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.
Signet Jewelers Limited SIG is now commanding a market cap of 917.73M and a float of 50.64M. SIG is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of SIG stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: we hold no position in SIG, either long or short, and we have not been compensated for this article.